How To Write A Business Contract Termination Letter With Samples

Contract termination letters are necessary for communication with your vendor so you can terminate your agreement in a civilized way. You may be trying to dissolve a relationship with a vendor, 1099 contractor, or even your landlord but when writing a business contract termination letter there are a few things to include so that everyone involved understands the details of the termination. This will reduce future problems and help to maintain the relationship with your business partner.

Before Creating The Contract Termination Letter

Before entering into an ongoing contract be sure that all parties understand the termination process. Normally in business each party can either terminate their agreement with out notice or terminate the agreement with a 30 day notice. This is important to clarify in writing before entering into the agreement.

march may 2008 009 300x225 How To Write A Business Contract Termination Letter With Samples

Contract Termination Sample Reason

Writing the Contract Termination Letter

Everyone has a different style and tone to their contract termination letters but after writing over a thousand contract termination letters there are some things that you may want to include for sure. These include:

Who are you are terminating the agreement with.
The part in the terms and conditions that provide instruction on how to terminate the agreement.
The date and time that the termination will take place.
Any reasons for the termination
Date of the termination from the agreement
How your business partner should follow up with you after the termination.

Ethics Count In Contract Termination Letter

Since we normally work with the vendors and people again it is important to have strong morals and business ethics when terminating an agreement. Be sure to pay your vendors when you have agreed to, be sure to give the appropriate notice if you may not be able to pay them, and do not enter into a contract unless you know for sure you can hold up your end of the deal. If not you may be burning a bridge that you will need one day. Be clear and professional with any termination letter with out using any personal insults or aggravated wording. There is no need to flame a fire when you just want to terminate a contract.

Contract Termination Horror Stories

At one point a small business owner tried to terminate an agreement with me in Santa Monica with out notice. The vendor had a manager tell me after I completed the work that they did not have the money to pay me and may not have it for some time. This caused a lot of problems because one person did not follow through with there agreement. Be sure this does not happen to you and have the money in the band before you hire someone for a job. You may be taken to court if you can not pay the agreed amount.

Example Contract Termination Letter

1/1/2012

Address of party 1

To whom it may concern:

Thank you for your business. Please consider this our notice to terminate the contract contract between (party 1) and (party 2) on good terms ending Month Day, Year. The original agreement allows this type of termination in section (provide section numbers here). The reason for the termination is (reasons for termination). If you have any questions about this contract termination please contact us by email at (email address).

Sincerely,

Party 2 Name

Address of party 2

Contract Termination Letter Follow Up

After you have delivered the termination letter (you may want to have someone sign for it if it is very time sensitive) it may be smart to follow up with a quick call to confirm they have received the termination letter. This may also be a good time to negotiate any additional contracts in the future to save the vendor relationship. Be sure that you have paid your vendor in full when the contract is terminated so there is no additional confusion on payments. This quick call has helped me in a number of situations where the letter was not received by the correct person or the mail was not delivered correctly.

Media For Contract Termination Letters

Each “Contract Termination Letter” is different because hopefully it will depend on the original contract to determine how the termination will go about. In many cases a fax, letter sent by USPS, or an in person delivery of the contract termination is required to process. This may be due to security reasons since if some contracts end and service is interrupted it could cost the lives of others. As an example you would need more than a phone call to cancel the electrical service at a 24 hour hospital.

In most cases a media company or a company that uses technology will allow for contract termination letters to be delivered by email or through their web site. They try to make it easy for their clients to get what they want by using the technology that is available to them. A simple phone call may also be enough to cancel your contract and they may send you an email letter in response so that you do not need to spend additional time creating a contract termination letter for them.

Email Example For A Contract Termination Letter

1/1/12

Cindy Shabbis

4455 Balboa Blvd.

Tarzana, CA 91345

To whom it may concern:

Thank you for your business. Please consider this our notice to terminate the contract contract between Laura Hulbecker and The Creative Agency on fair terms ending September 11, 2012. The original agreement allows this type of termination in section 2a. The reason for the termination is that the services provided did not meet our expectations in terms of the return invested in the project. If you have any questions about this contract termination please contact us by email at laura@hulbecker.com. Thank you for your business.

Sincerely,

Laura Hulbecker

1001 Aliention St.

Westwood Village, CA 90026